FIN 2018-08-21 Item 2A - Discussion - Business and Occupation (B&O) Tax Revenue

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.120 Cancellation of penalties. A. The Director may cancel any penalties imposed under subsections .110 if the taxpayer shows that its failure to timely file or pay the tax was due to reasonable cause and not willful neglect. Willful neglect is presumed unless the taxpayer shows that it exercised ordinary business care and prudence in making arrangements to file the return and pay the tax but was, nevertheless, due to circumstances beyond the taxpayer's control, unable to file or pay by the due date. The Director has no authority to cancel any other penalties or to cancel penalties for any other reason except as provided in subsection C. B. A request for cancellation of penalties must be received by the Director within 30 days after the date the Department mails the notice that the penalties are due. The request must be in writing and contain competent proof of all pertinent facts supporting a reasonable cause determination. In all cases the burden of proving the facts rests upon the taxpayer. C. The Director may cancel the penalties in subsections .110 one time if a person: 1. Was not licensed, and filing returns, 2. Was unaware of its responsibility to file and pay tax, and 3. Obtained business licenses and filed past due tax returns within 30 days after being notified by the Department. 4. The Director has no authority to cancel any other penalties or to cancel penalties or interest charged upon amounts due for any other reason except as provided in subsection C of this section. .130 Taxpayer quitting business - Liability of successor. A. Whenever any taxpayer quits business, sells out, exchanges, or otherwise disposes of his business or his stock of goods, any tax payable hereunder shall become immediately due and payable. Such taxpayer shall, within ten (10) days thereafter, make a return and pay the tax due. B. Any person who becomes a successor shall become liable for the full amount of any tax owing. The successor shall withhold from the purchase price a sum sufficient to pay any tax due to the city from the taxpayer until such time as: 1. The taxpayer shall produce a receipt from the City showing payment in full of any tax due or a certificate that no tax is due, or 2. More than six (6) months has passed since the successor notified the Director of the acquisition and the Director has not issued and notified the successor of an assessment. C. Payment of the tax by the successor shall, to the extent thereof, be deemed a payment upon the purchase price. If such payment is greater in amount than the purchase price, the amount of the difference shall become a debt due such successor from the taxpayer. D. Notwithstanding the above, if a successor gives written notice to the Director of the acquisition, and the Department does not within six (6) months of the date it received the notice issue an assessment against the taxpayer and mail a copy of that assessment to the successor, the successor shall not be liable for the tax. 40 Draft B&O Administrative Provisions Page 8 of 16